This week we talked about some of the pitfalls to avoid when purchasing land and it’s timely for Melburnians because the city is undergoing a massive land sale boom.
More land was released in Melbourne than in any other capital city last year, it was a record number of lots in fact, and with demand also healthy, prices rose accordingly.
In the Urban Development Institute of Australia’s State of the Land report, it found nearly 20,000 lots of land were released last year, which was around 7000 more than the previous year.
The demand for the land lots released onto the market has met the supply, with the median land price rising by 3.8 per cent in 2015 to hit $211,500.
While Melbourne released more land than any other city, it couldn’t get anywhere near Sydney’s whopping land price jump of 29.7 per cent in 2015, recording a median land price of $440,725.
Predictably, while land prices in Melbourne are rising, they are also getting smaller, the average lot size last year dropped by 3.3 per cent to 430 square metres.
The release of land lots in Melbourne will be a crucial necessity to service the expected 1.9 million extra people the city is expected to gain in the next 15 years.
The State of the Land report found that about half of the new population to join Melbourne in the next 15 years will be housed in growth areas.
Demographer Glen Capuano from id Consulting told Domain that national building approvals showed Australia was now building more dwellings than needed to match population growth, but that growth was largely concentrated in the inner city apartment market in Melbourne.
“Australians have always shown a preference to attached housing,” he said.
“And there’s very few places that young families can afford to buy a house in Melbourne…so we need to make sure that infrastructure keeps up with demand.”